Archives for November 2013

The International Federation of Accountants (IFAC) is taking a poll of key issues confronting small- and medium-sized practices (SMPs) and their clients.

The SMP Quick Poll is being conducted in 17 languages and focuses on the International Auditing and Assurance Standards Board’s (IAASB) Auditor Reporting Exposure Draft and integrated reporting, in addition to other industry trend questions.

The National Association of State Boards of Accountancy (NASBA) has announced recipients of three prestigious awards. Awardees were honored at the 106th Annual NASA Business Meeting Oct. 29.

Diane M. Rubin was presented with the 2013 William H. Van Rensselaer Public Service Award, which recognizes individuals who have led the development or improvement of Boards of Accountancy programs, or influenced the passage of rules or statutes to improve accountancy regulations and laws, with the goal of protecting the public. Rubin, a retired partner with San Francisco-based Novogradac & Company (FY12 net revenue of $84 million), is a former president of the California State Board of Accountancy and former chair of NASBA.

Andrew L. DuBoff is the recipient of the NASBA Distinguished Service Award. Since 1999, recipients of this award have demonstrated unswerving commitment and dedication to enhancing the mission of NASBA. As a retired partner with New York-based PricewaterhouseCoopers (FY12 net revenue of $10.2 billion), DuBoff has contributed over 35 years to the accounting profession, including extensive work on the New Jersey State Board of Accountancy. Over the years, DuBoff has been regarded as a “guiding light” through the tangle of the Uniform Accountancy Act negotiations.

Richard Sweeney is the recipient of the Lorraine P. Sachs Standard of Excellence Award, which salutes Board of Accountancy executive staff leaders who demonstrate excellence in regulation and make a positive impact on the profession. Sweeney is executive director of the Washington State Board of Accountancy. Prior to this appointment in 2005, he served as special assistant to the elected Washington State Auditor. During his tenure as executive director, Sweeney has been successful in building the Washington Board into a model agency, NASBA said.

A circuit court judge in Kentucky has ordered Chicago-based Grant Thornton (FY12 gross revenues of $1.25 billion) to pay $100 million in damages related to sale of an offshore tax shelter that the IRS considered to be abusive.

The Wall Street Journal reported that the accounting firm must pay Bill Yung, president of a Kentucky-based hotel company, his wife and his family trust a total of more than $100 million, including $20.22 million in compensatory damages, and $80 million in punitive damages, ruled Kenton Circuit Court judge Patricia Summe on Nov. 15.

In a statement, Grant Thornton said it was “disappointed” in the ruling and believes it has “strong grounds for an appeal.”

According to court papers, in early 2000 Grant Thornton sold Yung a tax shelter to move offshore money into the U.S. with few tax consequences at a time when the IRS was cracking down on what it considered to be abusive tax shelters. The advice cost Yung and his family millions of dollars in taxes, penalties and interest, the lawsuit contends.

“We argued successfully that Grant Thornton had no business selling this product, knowing the previous position of the IRS when other accounting firms had previously tried and failed with this type of strategy,” said attorney Kevin Murphy in the Cincinnati Enquirer.

The case is one of many associated with offshore tax shelters sold not only by Grant Thornton, but KPMG, Ernst & Young and BDO. Some firms have already paid huge settlements. The judgment is believed to be the largest ever in the county and one of the largest in Kentucky.

Carlos Johnson of Oklahoma City, Okla., has taken on the position of chair for 2013-14 for the National Association of State Boards of Accountancy.

Members were installed Oct. 29. Previously, Johnson served as vice chair, director-at-large and southwest regional director of the NASBA board and numerous other leadership positions. Johnson is president of Carlos E. Johnson, CPA. Walter C. Davenport, of Raleigh, N.C., was appointed vice chair. Currently Davenport, a retired audit partner with Richmond, Va.-based Cherry, Bekaert & Holland (FY13 gross revenue of $125 million), serves as a member of NASBA’s Uniform Accountancy Act Committee and Standards Study Group. From 2003-2012, Davenport served on the NASBA Board of Directors as director-at-large and Middle Atlantic regional director.

Peter Scalise is the new director of the federal tax credits and incentives practice at New York-based Prager Metis CPAs (FY12 net revenue of $32.3 million). “We’re very excited to have Peter join the firm,” says Prager Metis co-MP David Neste. “By leveraging Peter’s extensive experience and subject matter expertise within specialty tax incentives, we plan to create new service lines that will better enable us to serve our clients, and add new streams of managed revenue to the firm’s tax practice.” Prior to joining Prager Metis, Scalise was the national PIC, leading the federal tax practice with Engineered Tax Services.

Miesel is national leader and chief economist for the firm’s global transfer pricing services group and Baker Tilly International’s Transfer Pricing Committee. Webb, with more than 25 years of taxation experience, is a member of Cherry Bekaert’s Atlanta tax practice. As an expert of the technology and life sciences as well as manufacturing and distribution industries, he is known for guiding clients through federal and state rules and regulations. Horky, previously a senior manager in Cherry Bekaert’s Charlotte office, she audits clients in the construction, manufacturing and professional service industries.

Donald Zief will be joining New York-based WeiserMazars (FY12 gross revenue of $132 million) as a managing director in its real estate group. Zief, an attorney and CPA, provides comprehensive tax analysis in connection with a variety of structured finance and real estate transactions. He is a REIT expert and is co-author of the Real Estate Investment Trust Handbook. “Donald is a well-known expert in the REIT industry and we welcome him to our firm,” said Shahab Moreh, PIC of the WeiserMazars real estate group.

Barnes Dennig of Cincinnati (FY12 net revenue of $12.9 million) is merging with Bertke, Sparks and Kremer of Crestview Hills, Ky., in a Jan. 1 deal that will expand Barnes Dennig’s presence in northern Kentucky.

The firm will add three partners – Andy Bertke, George Sparks and Harold Kremer – as shareholders. Ten percent of Barnes Dennig’s clients are in northern Kentucky, while Bertke, Sparks & Kremer gets about 70% of its business from the Bluegrass State, Sparks told the Cincinnati Business Courier.

Barnes Dennig MP Steve Hube said Barnes Dennig is strong in international, tax and specialty tax consulting, while Bertke, Sparks & Kremer specializes in local governments. Both firms will expand their valuation and certified fraud examiner capabilities. Barnes Dennig will keep Bertke, Sparks & Kremer’s northern Kentucky office and employees, and use its name for both locations.

Goldstein Sacks & Associates of Nashville has announced a merger with Dyersburg, Tenn.-based AlexanderThompson Arnold CPAs, the eighth largest accounting firm in Tennessee, according to a news release.

Larry Sacks and the Goldstein/Sacks & Associates team have been providing professional accounting services for more than 25 years. “ATA has the resources of a large accounting firm, which can be a great advantage for our clients, but they focus on providing personalized customer service,” Sacks said. “Our clients will see many positive things from this merger and will continue to work with the same employees they know and trust.”

Bartolomei Pucciarelli, a Lawrence, N.J., firm, is planning to merge with Boardman, Ohio-based Hill Barth and King (FY12 net revenue of $35.4 million), according to MP James Bartolomei in NJ.com.

“They are who we’d want to be if we had another 30 years to build it,” Bartolomei says. “This is the right time, the economics are right and we’re excited at the prospects here.” Bartolomei Pucciarelli will assume the HbK name, but the leadership structure and current staff of 20 employees will not change, Bartolomei says.

With the deal, HbK could expand into real estate development, foreign tax matters and business valuation, which are specialties of Bartolomei Pucciarelli. The merger also gives HbK access to clients in Princeton, New York and Philadelphia. Bartolomei Pucciarelli, meanwhile, would become better able to attract and retain clients needing services in wealth management, mergers and acquisitions and those specific to energy companies, which are HbK’s areas of expertise, NJ.com reported.